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S Illinois | That's the gold based view and history shows that works only when one's economy is export based. Demand for those products produced comes from foreign countries and the economy can continue to expand. In a mature service based economy the stockpiling of products would be a drag on economic output. Once basic needs are met, consumption is not price led and marginal demand for goods will not follow a straight line. This in turn leads to a slowdown in economic output as the supply of good builds. True deflation has to be accomplished by either productivity gains or a significant natural resource find. Yes we can get deflation with sound money aka gold but you are not going to get a humming service based economy with an expanding population with a tight money supply. | |
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Say goodbye
